China, supposedly the biggest growth market for liquefied natural gas, saw a shock drop in consumption in 2015, adding to the bearish pressures that are overwhelming the oil and gas sector and driving share prices to fresh multi-year lows.

China's LNG demand dropped 2 per cent last year, the first decline after years of double-digit growth, according to respected energy consultancy Wood Mackenzie.

The reversal in Chinese demand together with a slump in imports by the world's two biggest markets, Japan and South Korea, combined with an impending supply glut to heap downward pressure on the market, the Edinburgh-based firm said in a report.

Standard & Poor's again slashed its assumptions for oil prices, triggering warnings from analysts that credit ratings on companies including Woodside Petroleum and Santos are under threat.

S&P cut its 2016 assumption for Brent crude, the global benchmark, to $US40 a barrel from $US55. It also slashed its assumptions for 2017 to $US45 from $US67, while the longer term price is put at $US50, also down a considerable $US20.

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"We think S&P locally will move quickly to review its corporate ratings with a downgrade for Santos to BBB- a distinct likelihood," Mr Wilson said, pointing to a potential need for another equity raising to preserve investment-grade status.

Santos' shares plunged 8 per cent on Thursday to $2.86, their lowest close since 2003. Origin shares dropped 3.1 per cent to $4.05, the lowest since 2006. Oil Search lost 1.3 per cent and Woodside 2.1 per cent.

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S&P now expects a "substantive" response from North America in terms of declining production to "begin to emerge some time in the fall of 2016" as hedges roll off and limited access to capital cuts drilling further. It said the recovery would likely be "more gradual and prolonged".

Global LNG supply rose 4 million tonnes to 250 million tonnes in 2015, as production from new Australian projects offset the loss of production in strife-ridden Yemen.

The start-up of Queensland's first two projects lifted Australia's LNG export capacity from 24 million tonnes a year to 31 million tonnes and sets it on the way to become the world's largest supplier by 2019.

LNG demand in Japan, the world's biggest importer, dropped 4 per cent, while South Korean demand slumped 11 per cent. In China, LNG demand dropped to 19.5 million tonnes a year after years of growth of 10 per cent or more, with little expectation of an immediate rebound.